NVIDIA (NASDAQ:NVDA) Shares Down 5% – Should You Sell?

NVIDIA Corporation (NASDAQ:NVDA)’s share price fell 5% on Monday . The stock traded as low as $195.44 and last traded at $196.51. Approximately 153,173,736 shares traded hands during mid-day trading, a decline of 7% from the average daily volume of 164,664,094 shares. The stock had previously closed at $206.84.

Key Stories Impacting NVIDIA

Here are the key news stories impacting NVIDIA this week:

• Positive Sentiment: NVIDIA is reportedly discussing a financing backstop of up to $250 billion for OpenAI’s planned 10-gigawatt Ohio data-center campus. If completed, the project could generate substantial future demand for NVIDIA systems and deepen its role in AI infrastructure beyond chip sales. Nvidia and OpenAI in talks for up to $250 billion dollar AI backstop to fund AI infrastructure plans
• Positive Sentiment: The company announced a long-term partnership with Safe Superintelligence, founded by former OpenAI scientist Ilya Sutskever, and is reportedly investing $5 billion. The deal expands NVIDIA’s high-profile customer and research ecosystem and supports demand for its Vera Rubin systems. Nvidia to invest $5 billion in Ilya Sutskever’s AI startup
• Positive Sentiment: NVIDIA expanded its Agent Toolkit with PhysicsNeMo and CUDA-X libraries, while Cadence, Siemens, Synopsys and others are adopting the tools for autonomous chip-design and engineering workflows. This could broaden software-related monetization and reinforce NVIDIA’s platform advantage. NVIDIA expands Agent Toolkit
• Neutral Sentiment: NVIDIA also announced an open-model AI security alliance following a reported cyberattack, and plans to invest $1 billion in South Korea’s Naver AI infrastructure. These initiatives support its strategic positioning but are unlikely to materially change near-term earnings.
• Negative Sentiment: Investors questioned whether the OpenAI arrangement represents customer-backed demand or supplier-supported growth. The scale of the proposed guarantee could expose NVIDIA to substantial financial and concentration risk, prompting a broader selloff in AI hardware stocks. AI stocks fall after reported NVIDIA OpenAI financing plan
• Negative Sentiment: Reports that Chinese firms accessed advanced NVIDIA chips despite export restrictions add regulatory and geopolitical risk. Separately, disclosed insider activity shows substantial selling and no insider purchases over the past six months, a potential sentiment headwind.

Analyst Ratings Changes

A number of equities analysts have weighed in on the company. Tigress Financial restated a “strong-buy” rating and issued a $425.00 target price (up from $360.00) on shares of NVIDIA in a research note on Wednesday, May 27th. Morgan Stanley set a $288.00 price objective on NVIDIA and gave the stock an “overweight” rating in a report on Thursday, May 21st. Deutsche Bank Aktiengesellschaft restated a “hold” rating and issued a $255.00 price objective (up from $220.00) on shares of NVIDIA in a research report on Thursday, May 21st. Mizuho set a $300.00 target price on shares of NVIDIA in a research note on Thursday, May 21st. Finally, BNP Paribas Exane lifted their target price on shares of NVIDIA from $270.00 to $285.00 and gave the company an “outperform” rating in a research report on Thursday, May 21st. Three analysts have rated the stock with a Strong Buy rating, forty-eight have assigned a Buy rating and two have assigned a Hold rating to the company. According to data from MarketBeat.com, the stock currently has an average rating of “Buy” and an average target price of $304.26.

NVIDIA Trading Down 5.0%

The firm has a 50-day moving average of $207.85 and a 200-day moving average of $195.86. The company has a debt-to-equity ratio of 0.04, a quick ratio of 2.85 and a current ratio of 3.44. The firm has a market capitalization of $4.76 trillion, a P/E ratio of 30.09, a price-to-earnings-growth ratio of 0.40 and a beta of 2.21.

NVIDIA (NASDAQ:NVDA) last released its quarterly earnings data on Wednesday, May 20th. The computer hardware maker reported $1.87 earnings per share (EPS) for the quarter, beating analysts’ consensus estimates of $1.76 by $0.11. The firm had revenue of $81.61 billion for the quarter, compared to analysts’ expectations of $78.42 billion. NVIDIA had a net margin of 62.97% and a return on equity of 96.94%. The company’s revenue for the quarter was up 85.2% compared to the same quarter last year. During the same quarter in the previous year, the company earned $0.81 earnings per share. On average, equities research analysts anticipate that NVIDIA Corporation will post 8.79 EPS for the current fiscal year.

NVIDIA Increases Dividend

The company also recently declared a quarterly dividend, which was paid on Friday, June 26th. Investors of record on Thursday, June 4th were paid a $0.25 dividend. The ex-dividend date of this dividend was Thursday, June 4th. This is a positive change from NVIDIA’s previous quarterly dividend of $0.01. This represents a $1.00 annualized dividend and a yield of 0.5%. NVIDIA’s payout ratio is currently 15.31%.

NVIDIA announced that its board has authorized a share buyback program on Wednesday, May 20th that allows the company to repurchase $80.00 billion in outstanding shares. This repurchase authorization allows the computer hardware maker to repurchase up to 1.5% of its shares through open market purchases. Shares repurchase programs are generally a sign that the company’s board of directors believes its shares are undervalued.

Insider Buying and Selling at NVIDIA

In related news, Director Mark A. Stevens sold 885,000 shares of the firm’s stock in a transaction that occurred on Thursday, June 18th. The stock was sold at an average price of $210.17, for a total transaction of $186,000,450.00. Following the completion of the transaction, the director owned 5,207,271 shares of the company’s stock, valued at $1,094,412,146.07. This trade represents a 14.53% decrease in their position. The transaction was disclosed in a filing with the Securities & Exchange Commission, which is available at this hyperlink. Also, Director John Dabiri sold 625 shares of NVIDIA stock in a transaction dated Wednesday, May 27th. The stock was sold at an average price of $214.00, for a total value of $133,750.00. Following the completion of the transaction, the director directly owned 14,163 shares of the company’s stock, valued at approximately $3,030,882. This represents a 4.23% decrease in their position. Additional details regarding this sale are available in the official SEC disclosure. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Over the last quarter, insiders sold 1,901,125 shares of company stock valued at $410,583,015. Corporate insiders own 3.94% of the company’s stock.

Hedge Funds Weigh In On NVIDIA

Hedge funds and other institutional investors have recently modified their holdings of the company. Diversified Enterprises LLC increased its holdings in shares of NVIDIA by 44.2% in the 4th quarter. Diversified Enterprises LLC now owns 127,604 shares of the computer hardware maker’s stock valued at $23,798,000 after acquiring an additional 39,129 shares during the period. ASR Vermogensbeheer N.V. lifted its stake in shares of NVIDIA by 1.8% during the 4th quarter. ASR Vermogensbeheer N.V. now owns 3,169,377 shares of the computer hardware maker’s stock worth $591,086,000 after purchasing an additional 54,877 shares during the last quarter. Storen Legacy Partners LLC purchased a new stake in shares of NVIDIA during the 4th quarter worth $1,350,000. Weaver Capital Management LLC boosted its position in NVIDIA by 5.5% during the fourth quarter. Weaver Capital Management LLC now owns 85,216 shares of the computer hardware maker’s stock valued at $15,893,000 after purchasing an additional 4,439 shares in the last quarter. Finally, Arrowstreet Capital Limited Partnership boosted its position in NVIDIA by 3.6% during the fourth quarter. Arrowstreet Capital Limited Partnership now owns 26,652,420 shares of the computer hardware maker’s stock valued at $4,970,704,000 after purchasing an additional 936,506 shares in the last quarter. 65.27% of the stock is owned by institutional investors.

About NVIDIA

NVIDIA Corporation, founded in 1993 and headquartered in Santa Clara, California, is a global technology company that designs and develops graphics processing units (GPUs) and system-on-chip (SoC) technologies. Co-founded by Jensen Huang, who serves as president and chief executive officer, along with Chris Malachowsky and Curtis Priem, NVIDIA has grown from a graphics-focused chipmaker into a broad provider of accelerated computing hardware and software for multiple industries.

The company’s product portfolio spans discrete GPUs for gaming and professional visualization (marketed under the GeForce and NVIDIA RTX lines), high-performance data center accelerators used for AI training and inference (including widely adopted platforms such as the A100 and H100 series), and Tegra SoCs for automotive and edge applications.